Uncorrected Evidence 977

UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 977-iii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

OFFICE OF THE DEPUTY PPRIME MINISTER: housing, planning, local government and the regions committee

Is there a future for regional government?

Monday 27 March 2006

MS STEPHANIE HILBORNE, MR PAUL WILKINSON, DR MIKE CLARKE and MR CHRIS CORRIGAN

MR ANDREW COGAN, MS JENNY KARTUPELIS and MR RICHARD BOYD

MS SALLY LOW and MS CHARLOTTE MOORE-BICK

MS JANE THOMAS and COUNCILLOR FOOTE-WOOD

MR BOB NEILL and MR RICHARD DERECKI

Evidence heard in Public Questions 216 - 322

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Oral Evidence

Taken before the Office of the Deputy Prime Minister:

Housing, Planning, Local Government and the Regions Committee

on Monday 27 March 2006

Members present

Sir Paul Beresford

Mr Clive Betts

John Cummings

Martin Horwood

Anne Main

Mr Bill Olner

Alison Seabeck

In the absence of the Chair, Mr Betts was called to the Chair

________________

Memoranda submitted by the Wildlife Trusts and the Royal Society for the Protection of Birds (RSPB)

Examination of Witnesses

Witnesses: Ms Stephanie Hilborne, Chief Executive, and Mr Paul Wilkinson, Head of Conservation Policy, East of England, the Wildlife Trusts; and Dr Mike Clarke, Director of Regional Operations, and Mr Chris Corrigan, Regional Director, South East England, Royal Society for the Protection of Birds (RSPB); gave evidence.

Q216 Mr Betts: Good afternoon and welcome. First of all, can I give apologies from Phyllis Starkey MP, who is the Chair of the Committee, who has had to be away on important business in her constituency this afternoon, but the Committee is still in session and we welcome you to it. For the sake of our records, could you identify yourselves, please?

Mr Wilkinson: Paul Wilkinson, Wildlife Trusts, Head of Conservation Policy for the East of England.

Ms Hilborne: Stephanie Hilborne, the Wildlife Trusts' Chief Executive.

Dr Clarke: Mike Clarke, RSPB Operations Director, responsible for the English regions.

Mr Corrigan: Chris Corrigan, Regional Director for the RSPB in South East England and also a Member of the South East England Regional Assembly.

Mr Betts: Thank you. John Cummings is going to start off for us.

Q217 John Cummings: My question is directed to the RSPB. In your evidence, you tell the Committee that you believe there is a lack of consistent leadership on sustainable development across the English regions. Could you give the Committee some examples of good leadership models at regional level?

Dr Clarke: Yes. Two recent examples would be in the north-east of England and in the East Midlands, where, in both cases, a very clear framework is being produced within what were the Regional Sustainable Development Frameworks, now they are becoming called Greater Regional Strategies, and these are providing the rationale for then a series of strategies which come out of that for various limbs of regional delivery.

Q218 John Cummings: Is the Government Office in the North East failing, in relation to good leadership models in that area?

Dr Clarke: No. Clearly, one of the issues at the moment is that we have responsibilities spread across three principal institutions, as you will be only too well aware. We see that part of the issue which comes out of that, effectively with dispersed responsibility, is the need to bring together, in one clear central place, a strong framework. That we feel is one of the key challenges at the moment, how you bring that together, and indeed how you relate that to national level guidance and, indeed, from a sustainable development point of view, the UK Sustainable Development Strategy. We would hope, I think, that is one of the issues the Committee will be focused on particularly.

Q219 John Cummings: Do you know of any good leadership models in Government Offices throughout the country?

Dr Clarke: I think the north-east of England example we mentioned is one where they have taken quite a strong stance in encouraging the integration, as we have just referred to.

Q220 John Cummings: Are there any others?

Mr Corrigan: I would say that is one of the problems for the Government Offices.

Q221 John Cummings: Are there any other examples of bad leadership from Government Offices in the country?

Mr Corrigan: No.

Mr Wilkinson: If I may offer one good example; the Milton Keynes sub-regional area. As you will be aware, or the Chair will be aware, the Milton Keynes sub-region, the Regional Development Agency, the Regional Assembly, NGOs and the statutory agencies have been working together to produce a Green Infrastructure Plan. In response to the growth proposed for the sub-region, those agencies have got together and looked at particularly the green infrastructure environmental assets and how those can be improved in connection with the proposed growth.

Q222 Sir Paul Beresford: Your answers give an indication that if you want good national guidance actually you do not need regional assemblies to do this because it is just passed down to either collections of bodies, perhaps counties, or something like that, and it could be done without a regional assembly: yes? Can we note who is nodding, please: Dr Clarke was nodding.

Dr Clarke: I was acknowledging your point, Sir Paul.

Q223 Sir Paul Beresford: Now he is trying to dodge it?

Dr Clarke: No, not at all. I think, from our perspective, frankly whichever model you arrive at, it is a rather hackneyed phrase but it is a question of thinking global and acting local, from an environmental perspective; there is a need for some leadership from national government on this. Many of our national policies indeed are set within international obligations and so we feel there does need to be a read-across. In a sense, your point I think is one that stands, that, whichever model, if you have the right policy framework then we would see it being possible to apply those principles out into whatever governance model you have in the regions.

Q224 Alison Seabeck: Speaking generally about sustainable development, obviously you have your own personal difficulties with what sustainable development is, and how far is that in agreement with what the region understand is sustainable development, and indeed what at national level is understood as sustainable development? If both organisations could answer that, it would be helpful?

Mr Wilkinson: I think also that we take the sustainable development definition from the UK Sustainable Development Strategy, which outlines that sustainable development is composed of economic, social and environmental. Obviously you alluded to it in your question, that probably we would have more of an environmental slant than an economic one, but I think we can all recognise that it is formed of those three strands, and I think transposing that to whichever level, as Mike said, this is the most important thing.

Mr Corrigan: The UK Sustainable Development Strategy, I think, does set the right high-level priorities and objectives. I think that is fine. I think the challenge and where the difficulties come are delivery and achieving that, when it gets to the regional level, and the outcomes. If you look at actually what happens in regions on the ground, what are the pressures, we have got these high-level objectives for things like the environment, for instance, but we find, on issues like waste, water, loss of biodiversity, those are the things which are coming unstuck when it comes to implementation.

Q225 Alison Seabeck: Do you have a feel as to why those things are coming particularly unstuck, as you put it, at a regional level; is it that there is a lack of drive because there is no sense of accountability?

Mr Corrigan: One of the issues, certainly, in the South East, is if you look at the balance and the way that issues are pushed you have got very strong economic drivers in the region, the RDAs and particularly as well the Government Offices, to some extent. Also, if you look at representation within regional assemblies, there is a very strong economic focus. There is not the same counterbalance in terms of the environmental dimensions particularly in those bodies.

Q226 John Cummings: What would it take to deliver sustainable development effectively through regional governance? Can you give us some answers?

Mr Corrigan: I think one of the things that you could do at the regional level is look at the environmental representation, for instance, on regional assemblies and strengthen the environmental representation there. I think also you could make a much better read-across. As we were saying before, we have got some of the objectives and things that are in the UK Sustainable Development Strategy and then it is trying to translate those through, making sure those read through down to the actions of particularly the three main regional institutions. That read-across from here to the regional level does not work very well at the moment.

Ms Hilborne: I think that Natural England and the Environment Agency have got a key role to play in the region of helping to get the right answer, from our perspective, a more balanced answer coming through to some of these dilemmas that we face. If we were to think about environment strategies as being definitely required of the region and also perhaps statutory then there would be some balance brought into being with the economic driver in each region.

Q227 Anne Main: Can I go back to what Mr Wilkinson said and the green infrastructure that you said was being put in place with the model that you like. I would like to have a bit of a definition of 'green infrastructure', and do you believe that it should be absolutely compulsory, as part of any delivery, say, for example, of housing on a regional basis, that there is a green infrastructure to support it, so long as I am sure I know what your 'green infrastructure' means? I like the sound of it.

Mr Wilkinson: I can answer quite a long question with a very short answer, I think, which is, yes. Green infrastructure is part of the essential infrastructure of development, to be considered alongside the transport infrastructure, social infrastructure and schools and hospitals.

Q228 Anne Main: Really do you feel it is, because you have got regional targets for housing and things, do you feel that the green is being communicated at a regional level?

Mr Wilkinson: I think there are very positive signs. You will be aware of the recent growth area funding that has been allocated from ODPM, which is going towards green infrastructure projects, the majority obviously within the growth areas. There is a requirement that those lessons which are learned within the growth areas and through that green infrastructure funding and that policy development at the sub-regional level, such as with Milton Keynes, that those lessons and that best practice are transferred and translated into other areas. Answering your question on the definition of green infrastructure, I think we would say that green infrastructure is the network of sites, green spaces, which are for recreational use, for access and quality of life, but that those need to be of high wildlife and biodiversity value; they can be multi-purpose. It is multi-functional green space that we are looking for, linking those urban areas and parks and gardens and allotments and green cycle-ways, and suchlike, into the wider countryside, to nature reserves and looking at the benefits of linking urban and rural in that way, for people but also for wildlife.

Q229 Mr Olner: On delivering all these, do you think the emphasis on targets will make delivery a little bit better, or will targets impede the delivery on the ground of what you seek to achieve?

Mr Wilkinson: I think targets always help to focus the mind. The PSA agreements, I think within the Forum for the Future response, the Forum for the Future refers to PSAs and that it would be useful actually to have targets to which organisations report. I think that those tasking frameworks, which contain obviously the PSAs for each organisation, at the moment the reference is to sustainable development, but in a way those are quite weak in comparison with others.

Q230 Mr Olner: Do you think there is a tendency to try to hit the easy targets? The real comment about sustainability, in the end it is very difficult to achieve; the lip service to the bottom end of it is pretty good, but how would you ensure that, within those targets, you really did get a delivery of the total system, instead of just bits of it?

Ms Hilborne: It is an extremely challenging question, is it not; have you got the answer to that?

Mr Wilkinson: The review of Government Offices, as you will know, was published this month and there is a shift within the role for Government Offices, from a more grant administration role to a more analytical and performance management role.

Q231 Mr Olner: And monitoring?

Mr Wilkinson: Yes; performance management and monitoring, to look at the effectiveness of regional policies, and that could be a useful step in trying to look at how things are being delivered across the board.

Q232 Mr Olner: I could say I am confused, and the Committee would clap their hands and say, "Yes, you always have been," but there seems to me to be a myriad of bodies there which want to see the same goal but perhaps are sometimes tripping each other up. The question of the inquiry is, is there a role for regional government?. If there is, have the positions on sustainable development got to be lodged with the regions and nowhere else?

Dr Clarke: I am not sure about the 'nowhere else' but I think we have the very clear view that we have an array of national-level targets for sustainable development, PSA targets, and within that environment, yes, clearly there needs to be targets which then are laid across, in a consistent way, the various regional institutions. Then that ought to be part of the accountability mechanism, in terms of evaluating performance, and, to me, that seems to be quite a clear model which should be applied.

Q233 Mr Olner: We failed miserably to carry a referendum in the North East, and what have you. Are you going to make RDAs accountable; does what they are doing become more accountable to people? I am sure we want to see sustainable development, we want to see a good outcome, but, at the end of the day, we make the figures, how do we influence and control them?

Dr Clarke: Given the structure that we have, I think it gets back to what we were referring to just a moment ago, in terms of a tasking framework, with performance targets, which is transparent and can be accounted for at both a regional and a national level.

Q234 Sir Paul Beresford: The trouble with targets is that everybody groans; it is a government disease, like taxes and stealth taxes. They are everywhere and they cost money in auditing, they take time, often they are meaningless and yet you are wanting more targets imposed upon people out there who are trying to do some work?

Ms Hilborne: I think we want targets which balance the number of targets there are out there, the social and economic targets.

Q235 Sir Paul Beresford: You would take targets away and replace them with some more suitable ones?

Ms Hilborne: We are not politicians; we are here to represent the environment. Within the current framework that we are operating within, the issue is that the environment loses out because of the plethora of targets for economic and social roles, frankly. At any local authority or regional authority the same thing is the case, that whenever even a local authority is trying to promote something which is far more forward-looking and long term and about adapting to climate change, or something like that, it struggles with finance because there are not targets attached to the positive, environmental, long-term outcomes of targets.

Q236 Sir Paul Beresford: What you are saying is that, from your point of view, there should be different targets?

Ms Hilborne: That sounds good.

Dr Clarke: I think, as much as anything else, the way governance in the regions is dispersed, it also needs to be a consistent framework across the regional institutions; the one set skewed in terms of RDAs, another for the Government Office, and so forth.

Ms Hilborne: Coming back to the point about do we want a regional tier of government, again, we do not express a view about tiers of government but, in terms of looking at the environment, particularly the challenge of climate change, actually it is quite useful to be thinking on a regional level about how we look to link up landscapes, to allow us to react to changes of flooding patterns, to allow wildlife to adapt to climate change, for example, so there are some drivers, from an environmental angle, to be thinking about at a regional level.

Q237 Sir Paul Beresford: I would have thought that those would be better at a national level?

Ms Hilborne: You have that too.

Q238 Sir Paul Beresford: Following the other point, and national?

Ms Hilborne: National and regional.

Dr Clarke: Actually they are delivered through local action; whether we achieve any of those.

Q239 Sir Paul Beresford: Maybe it could be regional, smaller, bigger, appropriate to the environment itself?

Ms Hilborne: Transport is one.

Dr Clarke: Yes. I think, as Stephanie said a moment ago, there are quite a few elements of natural environment and land use, that the regional spatial scale is quite an effective one to be looking at, for example, you can look at a coastal flooding approach; a lot of natural systems operate on that sort of level.

Mr Betts: Thank you very much indeed for your evidence this afternoon.

Memorandum submitted by COVER/VCS - East of England

Examination of Witnesses

Witnesses: Mr Andrew Cogan, Chief Executive, Ms Jenny Kartupelis, Regional VCS Faiths interests, and Mr Richard Boyd, Disability East Consortium, COVER (East of England Regional Voluntary Sector Network and European funding advice in the East of England), gave evidence.

Q240 Mr Betts: Welcome to the Committee. As I said previously, the Chair apologises. Phyllis Starkey MP is actually in her constituency on important business today. Thank you for coming anyway and could you introduce yourselves, for our records, please?

Mr Cogan: I am Andrew Cogan. I am from the Community and Voluntary Fora for the Eastern Region.

Ms Kartupelis: Jenny Kartupelis, from the East of England Faiths Council.

Mr Boyd: Richard Boyd, from the Disability East Consortium.

Mr Betts: Thank you for that.

Q241 John Cummings: The Committee understands that your representatives sit on the East of England Assembly as nominees, rather than elected representatives; are you comfortable with this particular arrangement?

Mr Cogan: No. We have to be there.

Q242 John Cummings: When you say you have to be, where do you find the failings, the shortcomings, in that particular arrangement?

Mr Cogan: The stakeholder model has got a democratic deficit. People do not have a direct connection with the Assembly, it is filtered through nominating bodies. In our case the politicians are nominated by local authorities, we nominate four or five voluntary sector representatives, other bodies nominate environmental interests, business interests, and so on.

Q243 John Cummings: If you had to reorganise it, what would you do?

Mr Cogan: We quite like directly-elected assemblies, rather than regional assemblies.

Q244 John Cummings: You are in favour of directly-elected regional assemblies?

Mr Cogan: We have mixed views. As a sector, we have a range of views.

Anne Main: Can we hear your views?

Q245 John Cummings: We are here at this inquiry, you see, talking about regional governance?

Ms Kartupelis: We do not all have to be in agreement, do we?

Q246 John Cummings: No.

Mr Cogan: (Inaudible) interests.

Ms Kartupelis: Thank you.

Mr Betts: Even we disagree.

Q247 Martin Horwood: You can give us your personal views?

Ms Kartupelis: I will give you my personal view, if you wish, because, I am sorry to say, although Andy and I agree on many things, possibly it is not that one. I am not the Member of our Regional Assembly but I assist our nominee, who does sit on the Assembly, and my experience is that the political members of the Assembly find the community stakeholders grouping, as we call it in our region, to be very valuable, for a number of reasons. One is that they ameliorate, if one may say so to the people here, some of the fighting that can occur between political parties and bring to bear on it an experience that is somewhat different and they bring an apolitical viewpoint. If we were to have an elected assembly, such as that in London, I understand that the community stakeholders group would no longer be part of the assembly but would be an advisory group, sort of to the side of it. I think that our Assembly would lose something thereby. I believe the politicians think that as well. I would agree that there is a democratic deficit, insofar as people have got onto a body with some influence and power without having been elected.

Q248 Mr Olner: It is like the House of Lords then?

Ms Kartupelis: Perhaps we will be drawn on that. Some people might think, as well, that House offers a range of experience which might not be found elsewhere, I guess.

Mr Boyd: Being typical, I sit firmly between both points of view. The view that my consortium takes is that we are where we are and if there is a structure where influence can be brought to bear for the benefit of our membership and disabled people in general we will use that method to the best of our ability. It is ironic that we are part of a consortium of shareholder, if you like, stakeholder reps appointed within the COVER consortium and we are watching the members and officers trying to remove that away and delegate that to themselves to pick which stakeholder they see fit to represent which equality. That said, as the structure exists, we contribute positively to try to make it work better for the benefit of the people we represent, and we believe that we are not a silo, disability is not a silo, just as age is not a silo, and that we are trying to get involved in all levels and share it amongst the five of us. For instance, where age and disability have a shared interest, we will share that agenda among us and cascade that down to our system.

Q249 John Cummings: Recognising that you do contribute to the social, environmental and economic issues which are debated within your Assembly, what would need to change to make your representation more effective?

Mr Boyd: I do not have an instant answer. Sometimes I wonder what local MPs could contribute to a regional agenda, they are aware of this coal-face, just as we are. Sometimes I wonder what county councils do, having been formerly a leader of one, in the sense that sometimes the words are there but the actions are different and one will not do what the other has agreed to do. An example is - if you are keen on examples - the voluntary sector in the East of England provides an information service for disabled people by 'phone and website, except now that Hertfordshire is proposing to take that away from the voluntary service and integrate it back into the County Council structure. I have difficulty with that; so the words are there but the actions are not.

Q250 Anne Main: I shall be pursuing Hertfordshire then, since I am a Hertfordshire Member of Parliament; that is interesting. Can you give an example of how you influence the work of the Assembly; do you feel you are listened to? You say you are unhappy with that. I do not know whether you have got any other issues where you feel you are listened to; are you able to comment on the experience of social partners in the other regions, are they treated like you are, do you think?

Mr Cogan: I think we have some influence. Our region has a social strategy and it is a very fine, social justice document, in terms of it is going to improve the quality of life, improve social and economic inclusion, environment inclusion and do great things; the problem is the follow-through. I do not think it is tied up with the local delivery vehicles. It was written before Local Area Agreements, for instance, and that bringing together of commissioning and joint action alignment. I was looking only this morning at our health and social inclusion partnership of the Assembly and it is clear that the social policy of the region was at variance with what was happening on the ground locally, there was a huge gap between what the region was trying to do and what was happening on the ground.

Q251 Anne Main: Which should you do; what the region wants to do?

Mr Cogan: I think, try to bring them together, from a regional perspective, try to work with local agencies and local partnerships.

Q252 Anne Main: Why is there this variance then? Why do you think there is that variance between what the region is trying to do, or wants to do, and what the people on the ground are trying to do and want to do?

Mr Cogan: I think a lot of it is down to government initiatives. There are so many government initiatives, everything sub-regional is up for grabs at the moment, in terms of health structures, political structures, new Local Area Agreements, LSPs, all sorts of things; they are in a mess. There so many things happening, it is very hard to get hold of anything.

Q253 Anne Main: A government-created mess, is that what you have just described?

Mr Cogan: I think it is.

Q254 Alison Seabeck: Part of the question I was going to ask is around the welter of government initiatives you describe in your paper. What is your experience of dealing with the Government Office, to start with, generally; what are the relationships like?

Mr Cogan: Good and bad.

Q255 Alison Seabeck: In what sense; when it is bad, why is it bad?

Mr Cogan: I think the words are fine. Sometimes I think it is to do with their capacity, the numbers of people they have. Last week, they issued a notice to all their staff that there would be a 33 per cent cull of staff, which makes it very hard to talk to people when they are worried about whether they will have a job next month, next year, and the rest of it. For instance, we run the Community Champions Fund for the region and our personnel managers had to deal with four different civil servants in 12 months as their contact. There is a mixture. There are lots of good intentions, but, in practice, in a way, it is quite hard to make it work.

Q256 Alison Seabeck: Those four civil servants, are they there representing different government departments with the Government Office?

Mr Cogan: They were all in the same department; there was a merry-go-round of the organisation, some people were moving on and moving on and moving on.

Q257 Alison Seabeck: Nonetheless, at times that is complicated further by the fact that you have these different government departments within Government Offices. What is your experience of how they interrelate, those government departments, within Government Offices, or are they both silo-bound?

Mr Cogan: They are trying to make links across departments. We have got a sort of regional compact, trying to work across the various government departments; it is the early stages, it was signed just before Christmas. We are trying to work to get that across the range, but it is slow stuff.

Q258 Alison Seabeck: Coming back to the communication problem, which you described, about local and regional, you are feeding in information to Government Office in the region, which, in turn, they should be feeding up to national government in order to help inform policy there. Do you feel that is happening or do you feel you get to Government Office and basically you might just as well be talking direct to Government?

Mr Cogan: I think the feeding really does go up. I think the balance of power is downwards rather than upwards, in terms of flow of communications.

Q259 Martin Horwood: This is on a similar point really. We have seen stakeholder research, not specific to your region, which suggests and basically it asks stakeholders in the regional government process more broadly to whom they thought various bodies listened. They found the most influence on the three regional bodies was from central government and after that it was each other, so there was a lot of self-reference going on, and I think public opinion came bottom, after the voluntary sector and various others. The first question is, is that your experience, and the second question really is about who is doing the listening and are the officers in these assemblies more influential than you would expect in a democratic body?

Ms Kartupelis: I think there is a lack of continuity, in various ways, and what you have just phrased is an aspect of that. There is the one that Andy has mentioned, in terms of changes of personnel but also there is lack of continuity in terms of policy, because it seems to me that, at least with Government Office and now RDA, they are having to interpret to us the central government policy, rather than adapt it in any way to the needs of our particular region. If there is a new initiative then they are reflecting that initiative and we are having to adapt to it. Within the voluntary sector, perhaps surprisingly, there seems to be a greater degree of continuity than actually there is in governance, and certainly in the part of the voluntary sector that I represent I would say that is the case.

Q260 Martin Horwood: Do you feel that they are listening more to each other than they are to you, as a sector?

Ms Kartupelis: Yes, but not necessarily because they wish to, but possibly because they feel they have to, in order to deliver back to central government the policy that they feel they need to interpret on the ground.

Q261 Mr Olner: It appears to me that you are fairly well frustrated with what is going on at the moment. Are you frustrated because of the structure of what is there at the moment or are you frustrated because they have got very few outcomes?

Ms Kartupelis: The structure I think can be frustrating to everyone, not just to us in the voluntary sector but to the people in the bodies of governance as well, insofar as they may not have the manoeuvrability and flexibility they might feel that they need to act on a regional, as opposed to a central, level.

Q262 Mr Olner: There is a minimal level and I was listening with great interest when you were talking about sometimes the level of continuity at the Government Office in the region, but there is a tremendous amount of continuity in local authorities, particularly county councils, and I would suggest also regional assemblies, there is a fair amount of continuity there. Why is the thing breaking down? Where are you coming from when you are saying to this Committee, "There's a lack of continuity and that's what's spoiling all of the good things we want to do"?

Ms Kartupelis: I would locate it partly within Government Office and partly within the Regional Development Agency, in terms, as I say, of interpreting central government initiatives, because those are the things which have a discontinuity.

Q263 Mr Olner: Your message to this inquiry would be, "Forget the regional assemblies, forget the regional councils now; let's take it back down to county councils"?

Ms Kartupelis: No; sorry. I have not expressed myself well, in that case. I would say that regional government stands a fair chance of giving us continuity, if they were allowed by central government to have some flexibility in interpreting central government policy such that it was appropriate to the region.

Q264 Martin Horwood: Can I just pursue that exact point and ask you to give us a precise example, and that might be something like the Regional Spatial Strategy; is that an example of something where you feel that the regional bodies are interpreting a central policy rather than adapting it to local needs, or regional needs?

Mr Cogan: That is quite interesting, because I think there were something like 26,000 responses to the Regional Spatial Strategy and I imagine most of them will be hostile. What is surprising is how easily those large targets went through the Assembly and all the constituent bodies; it was quite surprising really.

Q265 Martin Horwood: There was a remarkably similar experience in the South West, I have to say.

Mr Boyd: My organisation is funded, to a greater or lesser degree, in the disability world, by grants, although we are a social enterprise. Just to take Essex, which I know well, I applied to 42 grant sources in order to run a county-wide structure. The irony was that when I applied to Government Office to do a regional review of disability and trends and demands over the next ten years I obtained more support more quickly there than ever I had been able to obtain from the fragmented structures of six counties and four unitaries. I will illustrate that more. If you live in the north corner of Essex your nearest hospital is in Cambridgeshire and so you are dealing with two authorities. I am just giving an example. On the edges of each authority, at the moment, which is where predominantly older people live and disabled people, they are ending up talking to two providers, or maybe three; if we talk to region we talk to one.

Mr Betts: Thank you very much indeed for your evidence.

Memorandum submitted by British Chambers of Commerce

Examination of Witnesses

Witnesses: Ms Sally Low, Director of Policy and External Affairs, and Ms Charlotte Moore-Bick, Policy Adviser, British Chambers of Commerce (BCC), gave evidence.

Q266 Mr Betts: Welcome to the evidence session. As before, I will just give apologies for Phyllis Starkey MP, the Chair of the Committee, who is in her constituency on important business this afternoon, but you are welcome anyway. For the sake of our records, could you just identify yourselves, please?

Ms Low: I am Sally Low, Director of Policy and External Affairs for the British Chambers of Commerce. This is Charlotte Moore-Bick, the Policy Adviser, who compiled our submission.

Mr Betts: Thank you.

Q267 Anne Main: In your representation, you discussed a lack of clarity of the regional agenda; why do you think this is and do you think the Government has run out of ideas after having a 'no' vote in the North East?

Ms Low: I think the referendum in the North East taught us a number of things. Certainly, from the British Chambers of Commerce's view, we are in favour of devolution. What that referendum taught us, and it was interesting that the North East Chambers of Commerce compiled a survey prior to the referendum which mirrored the result, was that there was resentment about the costs that people felt were going to be involved, they could not see the value of the proposals contained within it and did not really believe that this was serious devolution. It is not a rejection, as we see it, of regional government but it is a rejection in the way that it was formed. In terms of lack of clarity, from the business perspective we are seeing a lot of different layers and tiers in the whole structure of government, and what business is asking really is, from the point of view of representation, into that whole mix, where does business feature, but also who rules. If we are going to be serious about central government rules, and whatever, we have got a growing regional level there, there is the rise of the city regions as well coming out of recent debate and also local government, and we are seeing the launch of the Local Enterprise Growth Initiatives, and things like that, which further serve to strengthen the local government. Of course, with Chambers, their position, our network of Chambers of Commerce is unique, in that they are absolutely captured in their local communities, absolutely bedded in those communities and very strongly support the economic development activity that is going on. From that perspective, we seek more clarity about which level is going to come to the fore and which will have the decision-making role, particularly with regard to economic development.

Q268 Sir Paul Beresford: Would you not think the vote in the North East said more than you have just explained? The North East was the area which supposedly was most likely to go for a regional elected assembly; they said decisively "No." Therefore, if that can be extrapolated, everyone else might have said 'no' to an even greater degree and they do not want a non‑elected assembly either, so really we are looking at the wrong thing, if we are looking at regional government as it is structured by this Government now?

Ms Moore-Bick: I think the issue really was around the nature of the proposals for the North East Regional Assembly. From the business point of view, it was seen as likely to be very costly to businesses, an additional layer of government, as Sally was saying, not getting rid of anything but adding another tier of government. Indeed, it would have taken some of the power up from the local level rather than being devolution from the central level. We would not see regional government as being a sort of dead duck, if you like, it has still got a vital role to play; it is just how you go about doing that. I think there is a danger at the moment that we may get regional government by the back door. Regional Development Agencies are being given more responsibilities, particularly over delivery, rather than just an initial, strategic role, so there is real concern.

Q269 Sir Paul Beresford: You would want a total rethink, would you?

Ms Moore-Bick: We want greater accountability, certainly, and we need to look at how Regional Development Agencies conduct their procedures, and so on, how they involve businesses, regional assemblies as well; we are very concerned about the lack of business engagement.

Q270 Anne Main: You have just given one reason why you believe the model was rejected, the Government at the time gave a different reason; do you think there is a problem with everybody putting their own interpretation on why it was rejected? You do not believe the one which Sir Paul put forward, which is to ask if people still want it, you have your own reasoning. Have you got anything to back up that particular view, that it was a lack of clarity, that was why people rejected it, because it is not what came out from the Government's view at the time, they said it was a political one? Other people, who do not favour regional assemblies, say, "Well, it's just because we don't want them, and "No" is a 'no'." The people who say they want them because of the value of them, will you please say from where you have got that information?

Ms Low: What came out of the survey, as I say, which the North East Chambers conducted immediately prior to the actual referendum, was that business did not want something which it saw as bureaucratic and would add more costs without seeing value, so I can present the arguments from the business point of view and those were canvassed amongst our business members in the North East.

Q271 Mr Olner: You are happy about them being unaccountable; you are happy about a body being there which was distributing money but was unaccountable?

Ms Low: No; no. Accountability was an important part of that as well.

Q272 Martin Horwood: Can I ask how many businesses actually were contacted in that survey?

Ms Moore-Bick: We do not know.

Ms Low: I can certainly provide you with some information on it.

Mr Betts: If you could provide some information on that, it would be helpful.

Q273 Alison Seabeck: My question is linking into the debate that we have just been having about the structure, if you like. Clearly, you would be in favour of some form of reorganisation of the current three tiers of regional government, for coherence in the political process; how would you do that, do you have a model in mind?

Ms Low: It is a difficult question. If you look at it from the way that business approaches life then you need to concentrate on what the priorities are, exactly what we want to get out of it, and I think then something like Local Area Agreements is an important mechanism, potentially, for doing that. If you look at establishing a set of clear priorities and then track back to what sort of mechanism and structure should feed and motivate and enable those priorities to be met, that is perhaps the better way to look at it. It is an important opportunity for us now, with this debate and with the White Paper, to debate the various pros and cons of what the regional structure should look like. If you look at what we have got at the moment, the RDAs perform a duty as a mechanism and a framework which at least is funding and has a number of core priorities. What we are seeing, from our Chamber network and the businesses they represent, is a tendency to hang lots of other things off the RDAs, which does concern us. No problem with the way the RDAs were framed originally, but we do want to see them performing those core roles and we think it is very important to make that happen effectively, rather than using them, for example, as now they are in charge of the Business Link and business support network, as well as other things, and that is an important caveat really to where the regional levels are working. Equally, at local government level, it is important there, with a role for economic development, that business is at the heart of that focus and is genuinely part of that and represented in those models in local government.

Q274 Alison Seabeck: That is a very interesting answer and it links, in part, to comments in your paper about the consolidation of funding streams as well, in terms of bringing together perhaps a more efficient model. If you were going to look at consolidating funding streams and had to lose one of those arms of regional government in order to do that, which one would you lose?

Ms Moore-Bick: It is not necessarily about losing an arm; you may now have a single programme but you have still got the various streams of European funding, ESF, ERGF, obviously those are tailing off in many areas, but there is the Competitiveness and Innovation Programme, which is a fairly recent funding stream, and, from the business point of view, there is funding available to support export development, skills, and so on, but it is a very confused picture. If it were one stream, there was one point of contact from where they get the advice, they know what funding is available and also can see how the funding which has been given to the RDAs is being used on the priorities like skills and enterprise, economic development, I think it would provide greater clarity.

Q275 Alison Seabeck: Have you fed those views into any other government departments, because, clearly, if money is being wasted or duplicated, I assume you have already made those points to the appropriate people?

Ms Moore-Bick: Yes, we talk regularly to ODPM, making those points; absolutely.

Q276 Mr Betts: Is it about being interested in or bothered about serious devolution, or really is it trying to ensure you do not have bodies around which might be a bit anti-business and do things which you cannot quite control and would be unhappy about, bodies which might be out of your control or influence?

Ms Low: No, I do not think that is the case, given the long history and tradition of the Chambers of Commerce. They are rooted in their community and do play a major role and are interested in civic leadership and in local economic development, also encouraging enterprise into areas of disadvantage; there is an enormous amount of activity as well with schools.

Q277 Mr Betts: In which areas of funding do you want to see the goals?

Ms Moore-Bick: I think the five priorities of RDAs, as they stand, are the right five, from the business point of view; it is just how they go about acting on those. In the West Midlands, for instance, a manufacturing strategy was developed without any consultation with businesses. It is not about us protecting our interests, but if it relates to a major concern from businesses in the West Midlands, Rover, and so on, business should be involved in that. To come back to your point, I think the five are pretty much the right ones, but it is doing them better, it is making organisations like the Regional Skills Partnership actually work so that they are delivering the skills which businesses need, so people can get jobs in their region.

Q278 Martin Horwood: Just following on from Clive's point, far from supposedly being anti‑business, the RDAs, in particular, have a remit to be pro-business and to develop business, do they not? How many marks would you give them out of ten, in general, for being effective, pro-business organisations?

Ms Low: You will not be surprised if I do not give marks out of ten for that. It is patchy; the information we receive from our Chamber network is that it is patchy, and part of that is because the RDAs are being asked to do too much. Particularly with regard to the new responsibilities for business support, we are seeing an uneven delivery and an uneven response to that further role and responsibilities.

Q279 Martin Horwood: If they are being asked to do too much, it begs the question of where really those responsibilities should go. Would you rather that they were exercised at a more local level?

Ms Low: For something as practical and as business-related as business support, we would argue it should come down to the Chamber of Commerce network to deliver business support.

Q280 Martin Horwood: You should receive the funding directly then for that?

Ms Low: There have been various plans floated about this over the years, and, yes, it is a national network, private sector, independent and understands the needs of business, because what we are seeing is duplication and we are seeing reported, in some cases, services being provided where there is not actually a need being voiced. You can cut out some of that by producing a leaner, more efficient structure.

Ms Moore-Bick: I think it is about the RDAs trying to deliver that, to use the body for mechanisms which are there already, like the Chambers of Commerce, to deliver some of their strategic priorities. It is not about them setting up systems which duplicate what is already there in a region.

Q281 Sir Paul Beresford: One of the points made by the last witnesses was that there was a plethora of funding streams, if you like, new initiatives, chops and changes; to use a colonial phrase, "It's a dog's breakfast." Is that what you are saying really, that they may have not just too much to do but there is too much change, too many varieties within the changes?

Ms Low: The Chambers of Commerce have been in place since the 1750s, and since the eighties we have seen numerous different methods, one-stop shops, tax, enterprise, all sorts of organisations and methods of providing support for business, in one way or another, and now this latest incarnation, with the new model for Business Link, the IDB model. Yes, it is a mixture and there are numerous, for example, in a very small area, serving a small population, signposting operations and information. For example, in the North East, there are hundreds and hundreds of various small pots of funding which can be allocated for enterprise of some sort. There is a serious need now to look at this again and say we have got an ideal opportunity here, it would be a great shame to look back, in five or ten years' time, and think that really we did not rise to the challenge and produce an effective model.

Mr Betts: Thank you very much indeed for your evidence.

Memoranda submitted by Ms Jane Thomas and Councillor Chris Foote-Wood

Examination of Witnesses

Witnesses: Ms Jane Thomas, former Director of the Campaign for Yorkshire; and Councillor Chris Foote-Wood, Vice-Chair of the North East Assembly; gave evidence.

Q282 Mr Betts: Welcome to our evidence session and, again, I give apologies for the Chair, Phyllis Starkey MP, who is in her constituency on important business this afternoon; you are welcome anyway. For the sake of our records, could I ask you to introduce yourselves, please?

Ms Thomas: I am Jane Thomas. I am former Director of Campaign for Yorkshire, which then became the Yes for Yorkshire campaign.

Councillor Foote-Wood: Chris Foote-Wood, Vice-Chair of the North East Assembly.

Q283 Mr Betts: Can I just make it clear, as you have asked me to, that actually you are here in an individual capacity this afternoon, not on behalf of the Assembly?

Councillor Foote-Wood: That is correct.

Mr Betts: Thank you very much indeed.

Q284 Anne Main: In your representations, you were both highly critical of the lack of accountability of quangos. If you were to try to make them accountable, to which regional bodies should they become accountable, if you think they should be accountable?

Ms Thomas: I think the fairly straightforward answer is to a directly-elected regional body. In the interim period, I think that there is some discussion about moving towards a regional executive. I think that we are in a new era to have a debate and dialogue about best regional structures, but it is very, very obvious to me that we have got an enormous amount of regional architecture, at the moment, that we ought to develop and build upon and probably streamline in a much more effective way. In some ways the architecture is there, you have got that with the embryonic regional assemblies, you have got that with the RDAs, and certainly you could meld those into a regional executive, but the long-term answer, for me, is to have a directly-elected regional body.

Councillor Foote-Wood: It is in my evidence, the land of 100 quangos, and in the North East we have well over 100 government quangos. Really it is the lack of co‑ordination and the inefficiency of these numerous organisations that I firmly believe that, for regional government to work, and we have this very dissipated regional government, these quangos need to be responsible to a single body, a single organisation. My preference, like Jane's, is for an elected assembly, but that has been rejected, as you know. The alternatives would be either to use the existing regional assembly or to set up a regional executive, but I do emphasise, from my point of view, and we want to impress on you, that one organisation needs to take responsibility for co‑ordinating all these regional quangos, otherwise it will never work.

Q285 Anne Main: Thank you. You said there are 100; do you think that is too many, could they be made more efficient, more co‑ordinated, or more attuned to local conditions, dispensed with?

Councillor Foote-Wood: Certainly; absolutely.

Q286 Anne Main: Absolutely, dispensed with?

Councillor Foote-Wood: They could hardly be less co‑ordinated than they are. I do believe that the success of the Scottish Parliament and the Welsh Assembly has been due to Parliament giving those bodies responsibility, an overview of all their quangos and I think that is an essential element of what needs to be done. To me, it is self-evident that they ought to work under some kind of umbrella.

Q287 Anne Main: Okay, but did you say you still wanted 100, or is that too many?

Councillor Foote-Wood: Certainly the number could be reduced. Each of these quangos has its own board which is appointed by government ministers, and in my estimation there are about 1,500 of these people, far more than there are elected councillors. Quite honestly, I do not see why each of these quangos should have its own individual board; certainly the jobs they do should continue but why have 1,500 appointed members when you could have a single body responsible for all these quangos?

Q288 Martin Horwood: You seem to be suggesting that, if a proposal came back which did confer those kinds of powers on a North East Regional Assembly, you might be in favour of an elected assembly. Do you think actually there is the stomach in the North East for a second referendum, or would you be heading for just a second fall?

Councillor Foote-Wood: No. Martin, I do agree with your suggestion that it would be pointless having a further referendum; the way that public opinion is at the moment certainly it is against it. I am only expressing my personal view. As a practical person who tries to make things work, I am looking for a better solution in the interim. If we did have a single body, if, for example, the existing Assembly were given responsibility for these quangos, could prove itself, then perhaps, as with Scotland and Wales, ten or 15 years down the line public opinion might be different, but I cannot forecast that. I accept the present position. It has been rejected; we will have to look for other solutions.

Q289 John Cummings: My question is directed to yourself, Jane. No disrespect Chris, but the lady is much prettier than you. Jane, you criticise the devolution of budgets to sub‑regional bodies, in your evidence. In an ideal world, what do you believe should be devolved and to whom should it be devolved?

Ms Thomas: I think it is quite an interesting debate about the double devolution agenda at the moment. I think one of the things which are becoming evident is that the state is getting bigger at a regional level and accountability is getting less. One of the things which are happening on top of that is also that we are having the establishment of quite a number of new initiatives which are drawing down massive budgets. Somebody mentioned in previous testimony the LEGI budgets but also initiatives like Pathfinders, and things like this, and they are drawing down a large amount of state funding, where the accountability principle I do not think is melding with any local authority accountability and certainly is falling outside the remit of any other sort of democratic accountability. Sub-regionally, there is an awful lot that is happening and some of it is very positive. The Pathfinders in Sheffield is going to be very, very good for Sheffield, but it does beg a much wider question, which has not gone away with the North East vote, which is about governance and how we are spending, or quangos are spending, public money.

Q290 John Cummings: Could you give an example of what you would devolve?

Ms Thomas: What I would devolve down at a sub-regional level, I am very interested to see the new localism have some teeth to it. I would like to see local authorities have greater powers but I think they should be bedded within a formally-elected regional body, where there is money devolved down to a regional level, so you have a proper, multi-levelled governance arrangement, as we have in Europe.

Q291 Sir Paul Beresford: That has been rejected, so what would you do instead?

Ms Thomas: It has been rejected. I think we can dissect the North East vote till the cows come home and there has been ample discussion this afternoon about why it did not happen. I do think there is an issue about what was on offer and I would have to say that was not what we would have argued through Campaign for English Regions; real devolution. It was not devolving budgets.

Q292 Sir Paul Beresford: Hang on; let us go back. It has gone. Chris Foote-Wood says it has gone, so what would you have instead, to answer this question?

Ms Thomas: I think there are a number of opportunities, in terms of constitutional reform, which are opening up other avenues to explore this, and we have been talking this afternoon about House of Lords reform, about having a genuinely reformed second chamber where you could have a regional list. There are very many opportunities, with the new localism, about where you could think about having much more empowered, genuinely empowered, local authorities. I think you could sit within a powerful regional executive with some statutory rights an awful lot of overseeing and steering, in terms of taking some guidance from those properly constituted bodies.

Q293 John Cummings: Basically, you are accepting that the 100-odd quangos that you have at the present time in the North East, placed in your document, are going to continue for the foreseeable future?

Councillor Foote-Wood: Yes, because you could argue that most of these quangos, if not all of them, do a useful job, as far as a particular sector of government is concerned; what I am concerned about is the lack of co‑ordination. I would suggest to you, colleagues, that one way of doing that, without creating any new structures whatsoever, would be to give the existing regional assemblies the power to agree the budgets and business plans of the quangos. At the moment we are responsible for overseeing, if you like, the Regional Development Agencies, but we do not have any carrots and we do not have any sticks and the Regional Development Agency does not have to do what we think it should do.

Q294 John Cummings: Are you saying that the Assembly should really have more teeth?

Councillor Foote-Wood: Absolutely, John, I totally agree with that, and I am saying that a simple way to it is give us budget approval and we will start getting co‑ordinated; no doubt about that.

Q295 Mr Betts: Can I bring you back now to the sub-regional level, where I think you have said that you have got some reservations about the sort of regional approach, because you think it will be at the expense of the areas around the city and that it will tend to concentrate resources in the city. Is not there also the possibility that areas around cities, which currently are not involved in the decision-making process of the cities but are still affected by them, will actually gain some influence over that process, if we have some sort of city region model?

Councillor Foote-Wood: Mr Betts, if I may, I believe we are talking about two different things here. As far as the present sub-regions are concerned, unlike Jane, I support that system, because, with our agreement, the Regional Development Agency in the North East has devolved 75 per cent of its decision-making to the sub-regions, right across the board, which I support totally. I do have reservations about the city regions, for reasons with which I am sure all Members here are familiar, that there is a danger that the outside areas, the rural areas, as you suggest, Mr Betts, would be affected by decisions over which they had no control.

Q296 Mr Betts: Is it not the other way round, that currently they are affected by the decisions and they have no control? The classic case is in Sheffield, where a bit of our economic hinterland actually is in other regions, not being with the local authority areas, and there is no involvement or influence over what happens from those areas but in Sheffield clearly decisions are being made which affect them and they have no influence over it?

Ms Thomas: To answer concerning Sheffield, I think it is quite an interesting one about the city regions. I was one of the authors of the Sheffield City Region Development Plan for the Northern Way, so I have some interest in this. I think you are right, in a way it is drawing different players and bringing different people to the table, and that is really, really important. The problem for me is that the city region still has not tackled head‑on either the governance issue or the accountability issue, and that was the one thing that the regional agenda and the regional debate did attempt to do. City regions have got a role to play, I think, in the future, certainly in determining some of the economic issues, some of the productivity issues that we looked at a lot with Sheffield and, in particular, the bit of north-east Derbyshire which has been drawn into Sheffield City Region, which is very much part of the economic drivers of Sheffield. I believe that the economic case for city regions should run parallel but it does not answer the governance and accountability things, which really, I think, was being asked with this particular submission.

Q297 Alison Seabeck: You have answered some of it with your response to Mr Betts' question, but two follow-ups from that. How easy will it be, in your view, actually to define a city region?

Ms Thomas: I think there is not a 'one size fits all', there never has been. One of the things that Northern Way has thrown up, which has been very, very interesting, is some sort of debate, a regional debate, about what we think about place and space, and for different people it means different things. Mr Betts will have as much a feel about Sheffield as I have, in terms of the Sheffield City Region; there is some resonance around that. Certainly in terms of 'travel to work' patterns, leisure patterns, and things like that, there is the emergence of some fear, but boundaries can be history's scars, can they not, and you have to be very, very careful. Barnsley now is in two city regions. Stephen Houghton, the Leader of Barnsley, just thinks this could be a win-win, so I think it depends on your outlook as well, and I would agree with that position. I think the one thing that we have learned in the last five years is that we can get too hung up on lines on maps.

Q298 Alison Seabeck: Are there some key powers which city regions ought to have, if they are going to be economic powerhouses in their own right? If so, from where would they be drawn, given that you have got this boundary issue and people are protective of their own boundaries and their own responsibilities; how would you break all that down?

Ms Thomas: This is d�j� vu again, is it not, it is exactly what powers regional government should have? At the end of the day, if you want people to deliver, and coming back to the really important Treasury report on productivity, the one thing which came out of that productivity report, which I think was critical, was that we need different levers, we need different tools and different mechanisms in different parts of the country to respond to very different things, especially labour market issues. That was really interesting in the Treasury report which came out last week, about labour market issues being very different in London from outside, in a lot of the country. If you see city regions as being an economic driver and wanting to address productivity issues and wanting to address PSAII targets then the same sorts of powers need to be devolved to them as we thought should have been devolved down to regional government to address exactly the same questions.

Councillor Foote-Wood: I would demur on that, in that, if you gave powers to the city regions, presumably that is taking them away from the region. Why I support the region primarily is that it gives a proper balance between the cities and the rest of the region and sees fair play between them. We accept the crucial position of the cities as economic drivers and certainly we would do everything possible to support what they want, but not at the expense of the rural areas.

Q299 Martin Horwood: Councillor Foote-Wood has said almost what I was going to ask Jane Thomas, in response to what she has just said. It is almost like a variation of the West Lothian question, I will call it the Cheltenham question, if you want. If the new drivers of regional government are going to be city regions, how do towns like mine, which is 110,000 people, very vibrant, economically, socially and everything else, find our place in this new set‑up?

Ms Thomas: I am not convinced that city regions are the answer to the question, actually, and that was why I was saying that city regions are interesting. I know that there has been a lot of interesting academic debate, and indeed there is a lot of evidence to suggest that city regions can be powerful drivers. For me, there are two caveats. First of all, a lot of the research that has been done, from Salford and other places, has looked at European and American examples of city regions, where cities are nested within a devolved form of government, whether it is a federal system or regional government, so it is not a perfect science to draw on European examples. The other thing is that I think the jury is still out in terms of GVA benefits, in terms of what cities can do. I think it is interesting. I am glad that people are looking at devolving powers and decisions, because, inevitably, the city regions debate is coming back to the same debate that we started out with, the Campaign for the English Regions, which was looking at ending the quangos, looking at accountability and looking at moving away from a London-centric focus, which I think has led to a two-speed economy. It is a good debate but I do not think it answers the central and crucial questions.

Mr Betts: Thank you very much indeed for your evidence today.

Memorandum submitted by Commission on London Governance

Examination of Witnesses

Witnesses: Mr Bob Neill, Deputy Chair (and Conservative Assembly Member for Bexley and Bromley), and Mr Richard Derecki, Director of Studies (Senior Scrutiny Manager), Commission on London Governance, gave evidence.

Q300 Mr Betts: Thank you very much for coming this afternoon to our inquiry. Just to give apologies from Phyllis Starkey MP, the Chair, who is away in her constituency on important business this afternoon, but you are welcome anyway and could you identify yourselves, please, for the sake of our records?

Mr Neill: I am Bob Neill. I am a Member of the London Assembly and I am Deputy Chairman of the Commission on London Governance.

Mr Derecki: I am Richard Derecki. I am the Director of Studies for the Commission on London Governance.

Q301 Alison Seabeck: In your recent review, you argued very forcibly for a review of governance across London, and not just the GLA and the Mayor: why?

Mr Neill: That has not been done for the better part of 50 years. The Herbert Commission was the last attempt at a holistic view of the local government structures of London; Marshall afterwards was purely, I think, part of the picture. You might argue that Herbert itself did not go that far, because it was looking only at what we might regard as the traditional local government planning to ensure local government competences, when actually London has become so complex, in those 50-odd years which have gone by, that it is time for a completely holistic look at it. There is a danger that we are having little bits of reviews here, little bits of reviews there, a review of what is happening in the Health Service arrangements, a review of what is happening with the Mayor's powers and competences; we think we need to have a look at the whole piece.

Q302 Alison Seabeck: It is a very complex area and probably you will not be able to answer this, but what changes would you advocate; have you got in your minds already certain changes that you would like to see to the governance of London, across the piece?

Mr Neill: I think the thing that came through most strongly to us, and Richard, who ploughed through all the detailed evidence, can help us with the detail, was that there is a lot of confusion amongst Londoners themselves as to who is responsible for what and how the governance arrangements actually work. That is why I say it is not just what we think of as traditional local government, confusion about who is responsible for delivering the Health Service in its various sectors, where you sit with policing, crime and disorder, other emergency services, it is pulling that together and giving it a greater sense of accountability. Quite often, people come to us and say "We don't know who to go to," and tell us, "We've got a problem with the buses," on the one hand, and "I have got an issue with social services," on the other, or "We've got a problem with hospital admission," and so on.

Q303 Alison Seabeck: Reorganisation of local government is something which is always costly, never easy; have you done any assessment of how much that is going to cost London taxpayers to undertake?

Mr Neill: If you have a look at our report in detail, we set out some of the costs of previous reorganisation, which is actually why we do not suggest going down the route that I know the Mayor would like, with a major upheaval of all the boroughs, precisely because we think that would be too costly. We would prefer to build on what there is at the moment. It is not actually creating massive new structures but, as an example, you could devolve a number of the funding streams, which currently are administered by GOL, sometimes to the Mayor, in some cases directly to the boroughs and the CDRP money sensibly could go to the boroughs and European funding, such as we will have in the future, other things, sensibly could go direct to the Mayor. On the borough front, we argue that perhaps if boroughs are doing well and are well-performing authorities there is clearly already lots of argument for greater synergies between borough social services departments and the PCTs; that could be built upon and I can see an argument, in due course, for the boroughs taking on some of the commissioning work of PCTs. Those are elected and accountable bodies which ought to have that role.

Mr Derecki: I think very much the proposals from the Commission were not about creating new structures, they were very much about enhancing what is already there and finding where there is capacity to push that ability to deliver services.

Q304 John Cummings: You have partly answered the question in relation to who holds the purse strings for London, but what are the implications of this financial control for governance in London?

Mr Neill: As far as possible, we would seek to make it for London council taxpayers cost‑neutral; that is why we are very anxious not to get into big empires, and so on. I think the real difficulty that we have, and I know Sir Michael Lyons is going to look at it, is this disconnect between who provides the funding, on the one hand, and the people who are responsible for delivering the services and accountability to the actual ordinary user, on the other. That is the bit that we are trying to draw down into. Clearly, if you take London, for example, if you want to have significant improvements in London's transport infrastructure, the current base for raising revenue for that, of either fares or domestic council tax, being the only two tools you have got which you can change within London, probably is too narrow to achieve that. That is why we think in terms of returning the Business Rate, for example.

Q305 John Cummings: Do you think there is sufficient accountability for public expenditure in London?

Mr Neill: We do not think there is.

Q306 John Cummings: How do you think it should be strengthened?

Mr Neill: For a start, if we were to take GOL out of the ordinary rank of London Region Offices, because you can well argue, and I was interested in the debate you were having about what happened in the North East, that is not an issue in London. In a sense, there was a referendum, there was a settled structure of devolved city regional government here; let us strengthen that so you do not have to have GOL administering a lot of these things. Even though I do not agree with the Mayor, it is much better he has that power and is accountable for it, in broad measure, and, similarly at the local level, let us beef up the role of the boroughs. I would like to see far more scope for making sure that Local Area Agreements, the Strategic Partnerships are more accountable through the elected Members who serve on it.

Q307 John Cummings: In your evidence, in paragraph 3.11, you talk about a "clutter of institutions." What impact does this have upon policy development and service delivery; is it deliverable?

Mr Derecki: I think it does pull down to the problems of lack of transparency and the perceived accountability gap between local customers, consumers, local citizens.

Q308 John Cummings: Would you say it is a perceived accountability gap, or is it actual?

Mr Derecki: I think it is an actual one. They perceive that there is an accountability gap because they do not understand whom they should approach, nor to do with issues that arise, problems that come up, they do not know how to access information about the delivery of a particular service, they do not know who is actually funding that service and they do not understand the rights and responsibilities they have as receivers of those public services.

Q309 John Cummings: Do you think this is specific to London? I believe you are talking about the general public here, but surely this is the same right throughout the land, when it comes to trying to understand local authority expenditure?

Mr Derecki: I think it is. I think you have just heard a compelling argument previously about the 100 quangos which are operating in the North East. I do not think it is particular to London, but I think it is something that we picked up on in our work when we went out and collected our evidence base; it was a message that came over loud and clear and we are trying to respond to that.

Q310 Martin Horwood: Is not this partly because it is a relatively new structure and one of the reasons everybody across the entire country is confused about who does what in local government and regional government is because we keep on changing it every ten years? Planning powers go up and down like yo-yos, and surely in London I would have thought actually that with a high profile Mayor taking very specific positions on particular policies to do with, for instance, transport, I would guess that people in London actually are clearer about the division of responsibilities than in other parts of the country. Is not that your perception?

Mr Neill: Funnily enough, not as much as you would think. I understand your point, but, for example, a lot of the detail of it people do not pick up on. Most people think that the Mayor has direct control of the police, but of course he does not, there is a police authority in‑between. A lot of people are confused as to whether he has responsibility for some of the overground trains, as opposed to the tube. It is not just at the strategic level, where you have got a comparatively new structure, I agree, but also it is noticed particularly, I think, at the borough level. I use again, quite deliberately, the example of the Health Service because it came up quite a lot. There, you have got a disconnect between public health issues, on the one hand, the more basic primary care issues and the linkages in there with social services. Clearly, we are seeing already, and rightly, I think, more close working between local authority social services and the PCTs. There is logic in saying "Well, how do you actually make that more accountable for people?"

Q311 Mr Betts: Looking at the current model for governance in London, do you think that is a unique example of how things can be done in this country, or do you think it could be replicated in other large cities?

Mr Neill: I think I would be cautious about saying it can be replicated elsewhere, simply because London is unique, in terms of its size and complexity and the political situation, and in fact there is a settled measure of devolved government, which is still a matter of contention elsewhere. I think also the nature of cities varies enormously, as you will know, Mr Betts, from your experience with Sheffield. London, in a sense, can be treated as a one‑off; it is the largest city in Western Europe and it has got, at least broadly, acceptably-defined boundaries, in terms of the built‑up bit within the M25 being something which is recognisable.

Q312 Mr Betts: You may or may not be aware of the document which the IPPR have just launched, where they are almost saying that other large cities in the country could have a very similar system of an elected mayor with certain economic-related functions?

Mr Neill: I am not saying rule that out, and clearly there are powerful arguments for that. The only caveat I would make is, in terms of the actual, specific suggestions as to what bit of responsibility and competence goes where, we have done it deliberately from the point of view of this being a package drawn up by Londoners for Londoners. Listening to your previous witnesses, the issue, for example, of the rural areas and the hinterland in a city, which obviously does not apply in the same way as far as we are concerned; equally, our argument is that you can justify the London package regardless of whether you go down the city regions or city mayors route elsewhere in the country or not.

Q313 Mr Betts: In terms of the arrangements in London, and you were talking before about having a look not merely at what powers might be devolved to the Mayor but also what might be devolved to the boroughs, will there be any sense in which, some of the powers that the Mayor has, there might be some way in which the boroughs could actually hold the Mayor accountable rather than the GLA?

Mr Neill: That is the interesting thing; at one stage there was talk about there being possibly a Senate of London, and I think perhaps we went off the idea because we thought that yet another deliberative body was not going to add very much. What I would like to see is a culture building up politically in London which involves closer, more collaborative work between the Mayor and the boroughs. We came from a broad hierarchy, if you like, that you could see strategic issues, London-wide issues being dealt with essentially by the Mayor, with some of the things, like the Learning and Skills Council, like indeed the public health policy, being brought within the Mayor's envelope, accountable to the Assembly, so there is democratic accountability there. Then at the borough level things like borough policing strategy and targets; there, the borough police commanders being much more accountable to the local authority, to the borough, it is the same way that PCTs are being more accountable, at that day‑to‑day delivery level. It is finding the appropriate level and getting the accountability there.

Q314 Sir Paul Beresford: Just to follow on from Clive Betts, it is a bit of a turkeys and Christmas question, but perhaps the best way, would you not think, actually of tightening the relationship between the Mayor and the boroughs would be if we did not have a GLA as it is structured now but it was the leader of the representatives from each of the 32 boroughs, rather than a GLA elected Mayor?

Mr Neill: It is interesting; as you know, our Party favoured that, in fact, at one time, as it happens. When I talk to the borough leaders now, of all parties, they themselves have rather gone off that idea, simply in terms of the practicality, the time commitment for actually doing scrutiny over about a �9 billion budget, which is the gross revenue expenditure, in broad terms, of the GLA group. If you were to expect people to be running boroughs and keeping a handle on the Mayor over things like transport, policing, economic development, I think, with the best will in the world, that would prove very difficult. What I would like and what we do advocate is enhanced consultation, statutory consultation rights for the boroughs being built into the system, so that the Mayor has to consult them at an earlier stage than he does at the moment on points of development, taking more specifically into account their views on budgets, and so on.

Q315 Sir Paul Beresford: Let us be realistic. The Mayor consults.

Mr Neill: He does his own thing, you might say.

Q316 Sir Paul Beresford: He has consulted about expanding the Congestion Charge; everybody said "No" and he has gone ahead?

Mr Neill: That is the other bit, Sir Paul, of our document. That says that if you have increased power for the Mayor you must also increase the power of the Assembly to hold him to account. Therefore, what we suggest is that, in the same way as the Assembly amend the Mayor's budget by a qualified majority, the logic is to give it the same power to amend the Mayor's strategies, so the Transport Strategy, including the Congestion Charge, therefore would be subject then to amendment by the Assembly. It gives the Assembly something of a legislative role and it makes the Mayor deal with the people represented on the Assembly.

Q317 Martin Horwood: I wanted just to come back to you on the health dimension, because that seems an example of where, although you are arguing for more democratic accountability and I think you said, in general, for more simplicity so that people understand who has what responsibility, in practice what you are suggesting is something much more complicated. At the moment you have the Primary Care Trust functions, of which a core part is public health, and I speak to you with a little bit of knowledge here because my wife is a Director of Public Health, and you are suggesting splitting that into at least three different places, as far as I can gather. You are saying the public health function goes up to the Mayor, or to the Assembly, presumably the PCTs still exist in some form, and there is also accountability then to the boroughs. Surely that is going to be a much more complicated system in which it is much more difficult to co‑ordinate things?

Mr Neill: No, I do not think it need be, because when one looks at what we are going to have in London, it seems accepted now, pretty much, that there will be a single strategic health authority for London, which we support because we think that makes sense, therefore there will be a public health function being dealt with at the pan-London level. The Mayor, under the Act, has one of the cross-cutting responsibilities of the GLA, responsibility for improving the health of Londoners, so there has got to be a read-across there. I can remember a time, when I was in local government, when we had the public health function at a local level within the boroughs, and I should think it would work reasonably well.

Q318 Martin Horwood: You still have them, the public health function, which is roughly the same thing, (considering your responsibility, is it not ?)?

Mr Neill: Yes. I do not see it creating any greater split. What I am saying is that where there has to be a London public health strategy, where that has been drawn up on a pan-London basis, logically that should be dove-tailed in with the Mayor and his policies. Where things are being delivered at a borough level there is a strong argument for increasing the linkage between the borough and the PCT. As I say, a number of the boroughs have said, "The way we're working, we're starting to work so closely with our PCTs now," that there might come a point at which a borough which was performing well, recognised by the Audit Commission, actually might want to take over the commissioning role of the PCT.

Q319 John Cummings: Would you tell the Committee then what are the obstacles to effective representation of London's interests to central government?

Mr Neill: I think it comes back to the issue that we flagged up on GOL, because GOL has this, like all the Government Offices but it is more acute in London than anywhere else for that, it has set up a mutually contradictory premise. On the one hand, it is supposed to be London's voice in Government, on the other hand it is the Government's agent in London, and I do not think that works very well necessarily. I think it would be much better if GOL were slimmed down to just a support unit for the Minister, and the bulk of the rest of it was transferred to the Mayor, accountable to the Assembly, some of it we have already heard went directly to the boroughs, and I think that would make it easier for London's politicians to talk to national politicians with a fairly direct route, without things getting lost in GOL, I think. With the best will in the world, I think even ministers, GOL have said, looking back on it, you can be a bit of a post-box, and the trouble is with post-boxes they create delay and things just get shifted around.

Q320 John Cummings: Have you anything specific in mind, in relation to strengthening London's influence with central government?

Mr Neill: Yes. I think, if the funding were devolved, for a start, that would be a major plus. A lot of influence, of course, depends ultimately upon political clout, does it not. If London were able to raise and retain more of the revenue it needs to fund its own services, clearly that would be very significant clout indeed, if the Mayor not only was able to build on his prudential borrowing but was able, let us say, to pilot something that captured the value of tourism in London, uniquely, in terms of revenue, if we were able to look at a significant municipal bond issue, something of that kind, that might well strengthen our leverage, it seems to me, with Government.

Q321 Mr Betts: Do you not believe in taxation ?

Mr Neill: No.

Q322 Martin Horwood: Just for the record, some of us think London's influence on national policy-making is quite big enough already, thank you.

Mr Neill: I am conscious of the different view outside the M25 from the way we inside look at it.

Martin Horwood: It certainly is.

Mr Betts: Thank you very much indeed for your evidence.